How to Fight Against a Credit Card Judgment

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When you don’t make payments on your credit card debt, the creditor may turn your account over to a collection agency. When you still fail to make payments, creditors may sue you for nonpayment of the debt. If the court awards the creditor a judgment, the company can deduct a portion of your paycheck or amount in your bank account for payment of the debt. You can take measures to avoid or resolve a court judgment.

Contact your creditor or collection agency when notified of late payments. Financial hardships happen to everyone, and you can often negotiate with the company for lower monthly payments. Debt management and credit counseling agencies can also help you settle your debt and counsel you on your financial situation. Legitimate credit counseling firms are affiliated with the Association of Independent Consumer Credit Counseling Agencies or the National Foundation for Credit Counseling.

Respond to the creditor when a lawsuit is filed against you and make attempts to settle the debt. Creditors often want to avoid legal procedures and would prefer a smaller amount owed than more court costs, especially if you have difficulty paying your debt.

File a response to the lawsuit within 30 days after notified of the lawsuit if you believe the charges are inaccurate. Contact the particular court listed on the lawsuit papers you received. Because local and state procedures may differ, ask for information on how to respond through the court.

Show up in court on the date of the trial with copies of your statements and any other material you have on your account. You'll need the information if you dispute anything in the lawsuit, such as charges you didn't make or if you claim you never signed a loan agreement with the credit card company or collection agency. Point out any inaccuracies to the judge. The court usually grants judgment to the creditor when you've signed a credit card agreement and the creditor shows evidence you haven't paid on your debt.

Tips

  • An attorney might help your case if you believe you don’t owe the money or the amount demanded, but attorney’s fees might cost more than it’s worth to settle debts you owe. Lawyers often have free consultation services to go over your case. Bring all paperwork you have on your account and from the lawsuit to talk about your options. This gives you more information on how to deal with your court case or settlement negotiations even if you don't hire an attorney.

Warnings

  • If you lose a court judgment, creditors may still allow negotiations for some type of settlement. If you are unable to pay the debt, arrangements can be made to pay according to your means. Court judges often request negotiations between the parties when aware of a defendant’s inability to pay. If you simply cannot pay, you are called "judgment proof" because there is no way the creditor can get money from you. However, your debt stays on your credit report for several years. Creditors can also renew a judgment as it nears its statute of limitations date.